Order Passed Without Proper Show Cause Notice and Personal Hearing Set Aside by Gauhati HC

Background of the Case

In the matter of Ganapati Enterprise v. State of Assam [WP (C) No. 2153 of 2025, decided on April 25, 2025], the Gauhati High Court set aside the order and the summary of the Show Cause Notice (SCN) issued to the petitioner. The Court found that the Adjudicating Authority failed to issue a proper SCN under Section 73(1) of the CGST Act, 2017 and did not provide an opportunity for a personal hearing.

Facts of the Case

M/s Ganapati Enterprise filed a writ petition challenging an order dated April 28, 2024, arguing that:

  • No valid SCN under Section 73(1) of the CGST Act was served.
  • A personal hearing was requested but not granted.
  • The order was passed despite procedural lapses.

Legal Issue

Can an order be considered valid if passed without issuing a proper SCN and denying a personal hearing?

Court’s Observations and Reference

The Court referred to its earlier ruling in Construction Catalysers Pvt. Ltd. v. State of Assam [[2025] 93 GSTL 213 (Gauhati)] and noted that:

  • The summary SCN in Form GST DRC-01 is not a valid substitute for a detailed SCN under Section 73(1).
  • The statement of determination under Section 73(3) also cannot replace the mandatory SCN.
  • All documents must follow the prescribed formats—GST DRC-01, DRC-02, and DRC-07—and must be duly authenticated under Rule 26(3) of the CGST Rules, 2017.
  • Section 75(4) mandates a personal hearing before the final order. Failure to provide such an opportunity violates principles of natural justice.

Final Judgment

The Gauhati High Court concluded that:

  • The issues in the current petition were identical to those in the Construction Catalysers case.
  • Therefore, the Court set aside the Impugned Order dated April 28, 2024 and the summary SCN dated December 13, 2023.
  • The matter was disposed of based on established legal precedent.

Conclusion

This ruling underscores the importance of procedural compliance in GST adjudication. Orders passed without issuing a proper SCN and without granting a personal hearing are legally untenable and violate taxpayers’ rights.

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